The Following Overhead Cost Information Is Available for Lowman Inc

question 46

Essay

The following overhead cost information is available for Lowman Inc.for 2006: $\begin{array}{llc}\text { Activity } & \text { Allocation Base } & \text { Overhead Cost } \\\hline \text { Purchasing } & \text { Number of purchase orders } & \$ 200000 \\\text { Machine setups } & \text { Number of setups } & 80000 \\\text { Ouality control } & \text { Number of inspections } & 60000\end{array}$

During the year,2000 purchase orders were issued;500 machine setups were performed;and 1500 inspections were conducted.
Required:
A. Calculate the cverhead rates far each of the three activites.
B. If a particular job requires 8 purchase arders, 3 setups, and 4 inspections to fill, how much [verhead should be applied to the job?

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Definitions:

Behavior

Observable, coordinated responses to environmental stimuli.

Stimulus-Response

A concept in psychology and physiology describing how organisms respond to stimuli in their environment.

Operant Conditioning

Learning that results from rewarding or reinforcing a particular behavior.

Genetics

The branch of biology that studies genes, genetic variation, and heredity in organisms, explaining how traits are passed from parents to offspring.